Correlation Between NYSE Composite and FPX Nickel
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and FPX Nickel at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining NYSE Composite and FPX Nickel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and FPX Nickel Corp, you can compare the effects of market volatilities on NYSE Composite and FPX Nickel and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in NYSE Composite with a short position of FPX Nickel. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and FPX Nickel.
Diversification Opportunities for NYSE Composite and FPX Nickel
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between NYSE and FPX is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and FPX Nickel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FPX Nickel Corp and NYSE Composite is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on NYSE Composite are associated (or correlated) with FPX Nickel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FPX Nickel Corp has no effect on the direction of NYSE Composite i.e., NYSE Composite and FPX Nickel go up and down completely randomly.
Pair Corralation between NYSE Composite and FPX Nickel
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.16 times more return on investment than FPX Nickel. However, NYSE Composite is 6.35 times less risky than FPX Nickel. It trades about 0.16 of its potential returns per unit of risk. FPX Nickel Corp is currently generating about 0.0 per unit of risk. If you would invest 1,544,050 in NYSE Composite on September 1, 2024 and sell it today you would earn a total of 483,154 from holding NYSE Composite or generate 31.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. FPX Nickel Corp
Performance |
| Timeline |
NYSE Composite and FPX Nickel Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
FPX Nickel Corp
Pair trading matchups for FPX Nickel
Pair Trading with NYSE Composite and FPX Nickel
The main advantage of trading using opposite NYSE Composite and FPX Nickel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, FPX Nickel can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in FPX Nickel will offset losses from the drop in FPX Nickel's long position.| NYSE Composite vs. Acumen Pharmaceuticals | NYSE Composite vs. Mind Medicine | NYSE Composite vs. NL Industries | NYSE Composite vs. Ecovyst |
| FPX Nickel vs. South32 Limited | FPX Nickel vs. NioCorp Developments Ltd | FPX Nickel vs. HUMANA INC | FPX Nickel vs. SCOR PK |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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